Revenue Model for Online Communities – #1

I’ve just been reading (again) James Old (Pricewaterhouse Coopers) presentation (from 2001) regarding how to make money outta Online Communties. I’ve split the blog report into bits to make it more manageable and bloggy-like. These are the points raised.

1. What is the relationship between community and revenue?

  • At its heart, the term ‘community’ implies a sense of belonging among members.

  • If people belong to something then we can derive value from them.

  • Community is one of the critical concepts underpinning Internet related value creation and business models. Yahoo’s purchase of Geocities for $46m and Lycos’ purchase of Tripod for $58m were both predicated largely on the value of community. (heh, this was written in 2001 – think of the circulation-hungry Google et al bidding on AoL today)

  • However, there is a very large distinction between VALUE and REVENUE.

  • Value consists of all the BENEFITS of an online community.

  • Revenue consists simply of the MONETARY INCOME that the community generates.

Ok, I understand so far. Everyone can see that hordes of people gathering online has potential and are wondering how to profit from it. Got it.

Laurel Papworth

Named by Forbes™ Magazine in the Top 50 Social Media Influencers globally, named Head of Industry, Social Media (Marketing Magazine™) and in the Power150 Media bloggers (AdAge™). CERT IV Training and Assessment certified trainer (Diplomas and Certificates etc) Adult Education. Laurel has manager Facebook Pages for Junior Masterchef, Idol, Big Brother etc. and have consulted on private online communities for banks Westpac, not for profits UNHCR & governments in SE Asia. Lecturer, social media, University of Sydney for 10 years and Laurel has 11,000 online students. Laurel Papworth personally connects to 6 million followers online and has taught around 100,000 people in the last 10 years how to be social media managers.

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